IBIT Margin Calculator

How borrowing against a Bitcoin ETF works

When you hold a spot Bitcoin ETF in a brokerage margin account, you can borrow against it instead of selling. Under Regulation T you can borrow up to 50% of the position's value initially, which is about 2x leverage. Portfolio margin, where a broker offers it and you qualify, is risk-based and can allow more.

The catch is the maintenance requirement. Each broker sets its own house maintenance level on a single, volatile crypto ETF, and it is often higher than the standard 25 to 30 percent. If the ETF falls and your equity drops below that level, the broker issues a margin call and can sell your shares without notice. The margin-call price above shows roughly where that happens for the maintenance percentage you entered, but the real figure is set per security by your broker and is usually not published, so confirm it.

Margin interest is charged on the borrowed balance at a variable rate that resets as benchmark rates move. The monthly estimate above uses the rate you enter; compare each broker's actual published rate on the comparison page.

Borrowing against a Bitcoin ETF through a brokerage is margin lending, a fundamentally different and higher-risk path than an over-collateralized Bitcoin-backed loan. Margin uses leverage, which amplifies losses as well as gains. If your ETF falls in value the broker can issue a margin call and sell your shares without notice, possibly at the worst time, and you can lose more than you put in. Margin interest rates are variable and reset when benchmark rates move. Each broker sets its own house maintenance requirement on a single volatile crypto ETF, which is often higher than the standard 25 to 30 percent, is set per security, and can change without notice. We are a publisher, not a broker, lender, or investment adviser, and nothing here is a recommendation to use margin or leverage. Verify every figure, and your own eligibility, with the broker before acting.